With retirement of the space shuttle program looming next year and just nine flights remaining, NASA managers announced Thursday the first major wave of job losses, saying 160 contract workers would face layoffs Friday, the first of some 900 jobs that will be cut between now and the end of September.

"They are primarily manufacturing team members," shuttle Program Manager John Shannon said. "We have delivered the last pieces of hardware that those team members produce and we don't keep them on the (payroll). And that is in order to get our budget down to the marks and the assumptions we made early on. So we will start tomorrow and continue with the workforce reduction we had outlined."

Several hundred jobs will be lost to attrition and some employees will transfer to other contracts or projects. The rest will be laid off. Shannon would not say which companies would absorb the initial round of job reductions.

"Not all of the companies have notified their employees so I don't want to get real specific," he said. "But it's primarily for manufacturing and vendors."

Shuttle staffing peaked in the early 1990s, after delivery of the shuttle Endeavour and implementation of post-Challenger upgrades, when the contractor workforce climbed to around 24,000, with more than 4,000 NASA civil servants. The shuttle program currently employs about 1,600 NASA civil servants across the space agency and 13,800 contractors.

Production of major components, such as external fuel tanks built by Lockheed Martin and solid-fuel boosters built by ATK, is winding down as the program nears retirement.

As reported earlier, NASA's most recent authorization act included language that directed the space agency to take no action that "would preclude the continued safe and effective flight of the space shuttle after fiscal year 2010" if the next president--Barack Obama, as it turned out--decided to delay the orbiter's planned retirement. Depending on how one does the accounting, that directive had the potential to cost the agency nearly $90 million.

The Obama administration has expressed support for the addition of one shuttle flight to carry the Alpha Magnetic Spectrometer, an already-built, high-priority physics experiment, to the International Space Station.

But the Office of Management and Budget said the administration is sticking with the 2010 shuttle retirement date. The Bush administration's deadline was the end of fiscal 2010, or September 30, 2010. The Obama administration has since told the space agency the deadline is the end of calendar 2010. Between now and then, NASA has nine shuttle flights planned, including the AMS mission. But only eight missions are currently funded. Money for the AMS flight has not yet been appropriated.

In any case, the "do not preclude" legislation expired Thursday.

"This is the first significant loss of manufacturing capability," Shannon said. "We are hitting that point where we have the last production activities going on. So it may have happened a little earlier (without the legislation), but only by a month or two."

The announcement came during a news conference after an executive-level flight-readiness review that cleared the shuttle Atlantis for launch May 11 on NASA's fifth and final mission to service and upgrade the Hubble Space Telescope.

The mission is the only flight left on NASA's shuttle manifest that does not go to the International Space Station. Five back-to-back spacewalks, or EVAs, are planned to install two new instruments, six new batteries, a full set of six stabilizing gyroscopes, a replacement science instrument command and data-handling system computer, and a refurbished fine guidance sensor.

The astronauts also will attempt to repair two other science instruments, install new insulation, and attach a grapple fixture that will make it easier for a future crew aboard a shuttle follow-on craft, or a robotic spacecraft, to drive the telescope out of orbit at the end of its lifetime.

With the upgrades and new instruments, mission managers hope Hubble will remain operational for an additional five years or more.

About the author

Bill Harwood has been covering the U.S. space program full-time since 1984, first as Cape Canaveral bureau chief for United Press International and now as a consultant for CBS News. He has covered more than 125 shuttle missions, every interplanetary flight since Voyager 2's flyby of Neptune, and scores of commercial and military launches. Based at the Kennedy Space Center in Florida, Harwood is a devoted amateur astronomer and co-author of "Comm Check: The Final Flight of Shuttle Columbia." You can follow his frequent status updates at the CBS News Space page.
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